Kotteakos v. United States 328 U.S. 750 (1946)

U.S. Supreme Court

Kotteakos v. United States, 328 U.S. 750 (1946)

Kotteakos v. United States

No. 457

Argued February 28, 1946

Decided June 10, 1946*

328 U.S. 750

Syllabus

1. Petitioner and 31 others were indicted under § 37 of the Criminal Code for a single general conspiracy to violate the National Housing Act by inducing lending institutions to make loans which would be offered to the Federal Housing Administration for insurance on the basis of false and fraudulent information. Nineteen defendants were brought to trial, and the cases of 13 were submitted to the jury. The evidence proved eight or more different conspiracies by separate groups of defendants which had no connection with each other except that all utilized one Brown as a broker to handle fraudulent applications. Evidence of dealings between Brown and defendants other than petitioner was admitted against petitioner, and the judge instructed the jury, inter alia, that only one conspiracy was charged, and that the acts and declarations of one conspirator bound all. Petitioner and six other defendants were convicted.

Held: The rights of petitioner were substantially prejudiced, within the meaning of § 269 of the Judicial Code, and the judgment is reversed. Berger v. United States,295 U. S. 78, distinguished. Pp. 328 U. S. 756, 328 U. S. 777.

2. In applying the "harmless error" rule of § 269, it is not the appellate court's function to determine guilt or innocence, nor to speculate upon probable reconviction and decide according to how the speculation comes out. P. 328 U. S. 763.

3. The question is not whether the jury's verdict was right, regardless of the error, but what effect the error had or reasonably may have had upon the jury's decision. P. 328 U. S. 764.

4. If one cannot say with fair assurance, after pondering all that happened without stripping the erroneous action from the whole, that the judgment was not substantially swayed by the error, it is impossible to conclude that substantial rights were not affected. P. 328 U. S. 765.

5. Where the jury could not possibly have found, upon the evidence, that there was only one conspiracy, it was erroneous to charge that

6. Where the instructions obviously confused the common purpose of a single enterprise with the purposes of numerous separate adventures of like character, it could not be assumed that the jurors were so well informed upon the law that they disregarded the permission expressly given to ignore that vital difference. P. 328 U. S. 769.

7. In view of a charge in this case that the statements and overt acts of any defendant found to be a conspirator could be considered in evidence against all defendants found to be members of the conspiracy, it could not be concluded that the jury considered and was influenced by nothing except the evidence showing that each defendant shared in the fraudulent phases of the particular conspiracy in which he participated. Pp. 328 U. S. 770, 328 U. S. 771.

8. Neither Congress, when it enacted § 269, nor this Court, when it decided the Berger case, intended to authorize the Government to string together for common trial eight or more separate and distinct conspiracies, related in kind though they may be, when the only nexus among them lies in the fact that one man participated in all. P. 328 U. S. 773.

9. The dangers of transference of guilt from one to another across the line separating conspiracies, subconsciously or otherwise, are so great that no one can say prejudice to substantial right has not taken place. Section 269 was not intended to go so far. P. 328 U. S. 774.

10. Each defendant in this case had a "substantial right" within the meaning of § 269 not to be tried en masse for a conglomeration of distinct and separate offenses committed by others. P. 328 U. S. 775.

Primary Holding

A conspiracy does not necessarily arise when one person has criminal interactions with two or more people who have no connection with each other, despite their connection to the original person.

Facts

Kotteakos was one of several loan applicants on behalf of whom Brown made fraudulent applications for loans under the National Housing Act. Brown served as the broker for each applicant in seeking the loans, but otherwise there was no connection among the various applicants. Appealing his conviction, Kotteakos argued that the prosecution had failed to show that there was a single conspiracy linking them.

Opinions

Majority

Wiley Blount Rutledge (Author)

Felix Frankfurter

Frank Murphy

Harold Hitz Burton

There was no evidence showing that all of the conspirators were part of a single common plan or scheme, and many of them had no connection to any of the others. A conviction of conspiracy in this case would be similar to convicting many thieves of conspiracy because they had sold stolen goods to the same broker. A reasonable jury could not have concluded that there was a single conspiracy rather than several.

Concurrence

Hugo Lafayette Black (Author)

Dissent

William Orville Douglas (Author)

Stanley Forman Reed

Recused

Robert Houghwout Jackson (Author)

Case Commentary

This is an example of a "wheel" system, in which a single individual acts as the hub and communicates with several spokes, who do not interact with one another independently. Liability for conspiracy is less likely to arise in these situations, although it is possible.

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